Baseline’s latest research report reveals the two undervalued, but essential, elements of a winning cloud computing strategy.

ADOPTION IS STRONG

Despite these concerns, cloud adoption looks strong, according to our survey. A third of respondents say that their organizations have, or soon will have, software as a service (SaaS) deployments. In terms of private clouds, nearly as many are deploying platform as a service (PaaS) (28 percent), storage clouds (30 percent) and computing clouds (29 percent). The percentages for public clouds are somewhat lower: 24, 21 and 20 percent, respectively.

Cloud computing’s speed and cost-efficiency have won it fast friends. Initially, it seemed that these benefits arose only from the cloud’s two main features: the easy “sign and drive” deployment that Web-based services allow, as well as lower capital expenditures.

One example of this is HarperCollins Publishers, a book publishing company in New York that has been using a public cloud infrastructure since December 2010 for its Digital Technology Services. DTS supports multiple global divisions and is charged with managing the transformation of the company into a more digital entity. “We can have an image up and running in just a few hours, and it costs less than 10 cents per hour to run,” says Greg Mucci, director of digital technology operations. “This allows our business users to experiment in a very forgiving way.”

The company can launch a program with no financial commitments, so if the initiative is not successful, it can stop spending money almost immediately. “Alternatively, if something takes off, we can scale to a much more robust environment very quickly and easily,” Mucci adds.

Another example is GWR Medical, a company based in Chadds Ford, Pa., which provides products to treat chronic wounds. It began using Verizon Computing as a Service less than two years ago to store medical data about customers and share the information as needed with physicians and insurers.

The cloud “is reliable relative to uptime,” says Sean Geary, vice president and chief operating officer, “and I don’t have to drop money on a server rack to run these different applications, so there’s cost containment.”

Nevertheless, at this point in the cloud revolution, we’re learning that its benefits run deeper than just low cost and fast deployment. One dimension to the flexibility of cloud computing is the ability to control where your application investment is concentrated—based on the importance of the benefits you seek—simply by picking your “style” of cloud computing.

How so? We’ve been defining cloud computing as the disconnection of application from infrastructure, but within the cloud model, you can choose where this disconnection takes place. If it’s at the user interface, then it’s a SaaS solution. If it’s between the software and the interface, it’s PaaS.

If the functionality you need is not mission-critical, then public SaaS is a good low-cost option. On the other hand, if what you need is fundamental to your business strategy, you may want to build your own application. With PaaS, you can do that without worrying about the underlying infrastructure it’s running on. In both cases, you’re focusing your investment on the area that will give you the best advantage.

“One of the fundamental components of Kelly IT 2.0 was that we would build and deploy applications in the cloud going forward,” says Drouin. Kelly is now using Force.com, Saleforce.com’s PaaS offering, to develop and deploy internal and customer-facing applications. Additionally, the company has migrated about 9,000 users from an on-premises email system to a messaging and collaboration service hosted by Microsoft.

So flexibility in the cloud approach you take for a given application is another avenue for achieving cost efficiencies. You can also mix approaches within the application, such as using cloud-based storage to house data that’s processed by users of a SaaS system.